Q. How many homes should I plan to view and how should I make the final decision?
A. Generally you should view a number of homes so you can become familiar with what you can expect to get for your money. When you find a home you really like, it's a good idea to go back and look at it at a different time of day. That will give you a greater insight into what it will be like living in the home full time.
Q. How can I check my credit rating before I apply for a mortgage?
A. Your credit rating is based on a combined score generated from three credit bureaus who look at your credit history, amount of credit available, and recent inquires to determine what's called your FICO score. For a small fee, you can review your credit report by contacting the credit bureaus directly at:
Q. Why should I consider paying points?
A. Buyers often choose to pay a one-time charge called mortgage points in exchange for a lower interest rate. Usually paid at closing, each point costs 1% of the mortgage amount, or $1,500 on a $150,000 loan. The lower rate reduces the monthly mortgage payment and points paid in conjunction with the purchase of a home are generally tax deductible in the year they are paid (see tax advisor). Monthly savings will often exceed what was paid in points in just a few years' time.
Q. What is the purpose of an attorney review?
A. In states where the real estate agent writes the contract, there may be an attorney review period. This specified period allows the attorney to cancel the contract or request it be altered. Both buyer and seller would then have to agree to the revised contract in writing.
Q. What is title insurance and why do I need it?
A. Title insurance assures that you have clear title to the home you are purchasing. A title search is the primary component of due diligence, a process that will be started either by your attorney, if you are using one, or by the title company you choose. The title search determines whether the seller actualy owns the property and if there are any claims against it.
Q. What happens if the house I want to purchase does not appraise for the amount expected?
A. If the house does not appraise at the amount expected other alternatives are typically found. A second appraisal may be sought, the buyer may be willing to put more money down, the seller may adjust the price or offer other concessions, or the two sides may negotiate to split the difference between them.
Q. What should I do first - sell my home or buy my next one?
A. If you already own a home, you're probably struggling with this basic question. The answer is as unique as you. Generally most real estate professionals would advise you to list your present home and shop for your new home simultaneously. However, depending on the market and/or your individual needs, you may want to consider an alternative. In a very rebust market, a home could sell within a few days of listing. So if you have a very specific criteria for your new home, you may want to begin searching for and buying that home first before you sell your exisitng home. Your real estate broker should fully understand your individual needs and circumstances to help you find the right solution.